Comcast Lobbyist Admits To Holding Internet Service For The Poor Hostage To Get NBC Takeover Approved

from the regulatory-capture dept

The Washington Post has a profile piece about Washington DC power dealmaker David Cohen, who has led Comcast's policy and lobbying efforts for the past decade. It starts out (and ends) with a whopper of a story about Cohen explicitly had Comcast not offer a special internet offering for the poor since he wanted to use it as a bargaining chip in the NBC Universal purchase:

In fall 2009, Comcast planned to launch an Internet service for the poor that was sure to impress federal regulators. But David Cohen, the company's chief of lobbying, told the staff to wait.

At the time, Comcast was planning a controversial $30 billion bid to take over NBC Universal, and Cohen needed a bargaining chip for government negotiations.

"I held back because I knew it may be the type of voluntary commitment that would be attractive to the chairman" of the Federal Communications Commission, Cohen said in a recent interview.

At the end of the article, the reporter (Ceclia Kang) notes that the FCC later "took credit" for this program when it was launched:

The initiative may not have sealed the FCC's decision to approve the NBC merger. But it helped, Cohen said.

The proposal clearly captured the fancy of regulators. Late last month, Genachowski, the FCC chairman, touted the program, seemingly claiming some credit for its creation.

"This particular program came from our reviewing of the Comcast NBC-U transaction," Genachowski said in a speech. "Comcast embraced it as good for the country, as well as good for business. And I'm fine with that."

In other words, Cohen delayed a program to help the poor... in order to help make Comcast much, much richer in buying NBC... and then conveniently engineered it so that the FCC takes bogus credit for the program which would have been launched much earlier if Comcast hadn't used it as a bargaining chip. It's hard not to be cynical about politics in general and the FCC in particular when these kinds of stories hit the press. We've long been concerned about the FCC's ability to be played like a fiddle by industry lobbyists, and this only seems to confirm that point.

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Technically, if you want to look at things that way, I donate to the state & federal government, not the IRS (something I don't mind, honestly). But the other way to look at it is that if I take the deduction, I'm not actually donating at all, I'm just instructing the government to do so.

The reason that I don't take the deduction, though, has nothing to do with any of that. It has more to do with complexity and privacy. If I were to take the deductions, I'd have to make sure that the charities were actually considered as such by the IRS and I'd have to keep records of the donations.

Also, I'd have to tell the IRS about them, and it's none of their business.

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@John Fenderson,
I agree with you wholeheartedly. Not just that it's none of their business, but also on the complexity issues. However, I think claiming that taking the deduction is tantamount to instructing the government to donate in your stead is a bit disingenuous. That would only be true if you were taking a tax credit. A deduction, on the other hand, just prevents them from taxing you on that amount. Also, if you took the deductions, you could afford to give 12% or even more to charity, because the extra taxes you're paying could go straight to the charity's coffers instead of the governments.

Gosh, Mike, you're turning Populist!

That may be only because Populism sells, while Plutocracy doesn't.

"It's hard not to be cynical about politics in general" -- No, it's difficult to be too cynical.

Now, if instead of cloaking euphemisms such as "regulatory capture", you could use plain language like bribery of gov't officials, it's possible that even I could eventually understand that we may be, in broadest terms, allied against the practices of The Rich. -- But equally, you'd have to analyze enough and come to the conclusion that there's always a class struggle and it's waged by The Rich, and frankly, I doubt you're to that stage yet.

Re: Gosh, Mike, you're turning Populist!

How, exactly, does one become "allied against the rich?" "The Rich" is not some defined condition, it is an ever-shifting group of human beings with different backgrounds, beliefs, behaviors, ethics, etc. By declaring yourself "against the rich," you are really just declaring yourself a simple-minded collectivist, no better than racists, sexists, homophobes, Islamaphobes, or anyone else who values human beings not by their individuality, but only by how they relate to a specific collectivist group.

"Regulatory capture" is the right term because it is precise. It refers to exactly what is going on. And it is essential to call out because regulatory capture can only happen via government regulation. Get rid of government regulation, re-instate liability laws and property rights, remove corporate welfare, corporate safety nets, bailouts, and other risk-rewarding "regulations," and suddenly you have a truly regulated system. A system where business are accountable and liable to consumers. A system where a landowner can sue a corporation for polluting his land instead of waiting for some nebulous government structure to set a corporation-favoring regulation. A system where companies who have irresponsibly risky practices go bankrupt instead of being bailed out to do it again. A system where fraud can be prosecuted as fraud, and not as a slap-on-the-wrist fine.

There will always be classes. But class warfare only exists when the wealthy gain executive and legal privelege. And that can happen only through the abuse and corruption of an overly-powerful central government.

You want to be against something? Be against policies and systems that allow this to happen. But don't stand on your high-horse spouting hatred for those who managed to be more successful than you.

Re: Re: Gosh, Mike, you're turning Populist!

"The Rich" is not some defined condition, it is an ever-shifting group of human beings with different backgrounds, beliefs, behaviors, ethics, etc.

Being part of the "Poor" is mostly a transitional thing. Sure there are some who are permanently poor but a large percentage essentially move up as life goes on, ie. graduates from college, gets promoted, etc. Alternately, the "Rich" are always moving between categories all the time. The Super Rich now were not the Super Rich of the 80's. Sowell covered it quite nicely in this book.

Proving the US has the Best Politicians Money Can Buy

While I am sure any investigation into this process will just come up empty, and no one actual broke any laws. The whole situation just shows once again the the U.S.A. has the best politicians that money can buy. When will people STOP voting for incumbents ??? The more often we churn the politicians the less likely the lobbyists will gain influence, since politicians can only get back in office if they please us teh voting public.